Orange 21 Inc. Reports Financial Results for the Three Months Ended September 30, 2009 and Announces Investor Conference Call | CARLSBAD, Calif.--(BUSINESS WIRE)--Nov. 19, 2009--
Orange 21 Inc. (NASDAQ:ORNG), a leading designer, producer and
distributor of sunglasses, snow and motocross goggles, and branded
apparel and accessories for the action sports, motorsports, snowsports
and youth lifestyle markets, today announced financial results for the
quarter ended September 30, 2009.
Consolidated net sales for the three months ended September 30, 2009
were $8.8 million compared to net sales of $12.0 million for the three
months ended September 30, 2008. We incurred a net loss of $1.1 million
for the three months ended September 30, 2009, compared to net income of
$6,000 for the three months ended September 30, 2008. The net loss for
the three months ended September 30, 2009 included a $0.7 million
increase in inventory reserves for slow moving and obsolete inventory
and $115,000 in non-cash share-based compensation costs in accordance
with FASB authoritative guidance. Cash generated from operating
activities during the three months ended September 30, 2009 was $2.1
million and total cash generated during the prior comparable period was
$0.4 million.
“The current recession continues to have a significant impact on the
retail environment and our global sales. As such we will continue to
control costs and improve operational efficiencies where possible to
minimize future possible losses,” commented Stone Douglass, the
Company’s Chief Executive Officer. “During the most recent quarter, we
reduced total operating expenses by approximately $1.9 million from the
same period last year and expect to continue to benefit from cost
savings efforts during the fourth quarter of 2009.” Concluding, Mr.
Douglass added, “We are very excited about possible new opportunities
that are unfolding for Orange 21 and its shareholders and look forward
to rolling out our O’Neill Eyewear offerings in 2010.”
Investor Conference Call
We invite you to join us for an investor conference call on Thursday,
November 19, 2009 at 1:00, p.m. Pacific Daylight time. The dial-in
number for the call in North America is 1-866-543-6407 and 1-617-213-8898
for international callers. The participant pass code is 84776421. The
call also will be webcast live on the Internet and can be accessed by
logging onto www.orangetwentyone.com.
The webcast will be archived on the Company’s website for at least 60
days following the call. An audio replay of the conference call will be
available for seven days beginning approximately two hours after the
completion of the call on November 19, 2009. The audio replay dial-in
number for North America is 1-888-286-8010 and 1-617-801-6888 for
international callers. The replay pass code is 82202954.
About Orange 21 Inc.
Orange 21 designs, develops, markets and produces premium products for
the action sport, motorsports, snowsports and youth lifestyle markets.
Orange 21’s primary brand, Spy Optic (TM), manufactures sunglasses and
goggles targeted toward the action sports, motorsports, snowsports and
youth lifestyle markets.
Safe Harbor Statement
This press release contains forward-looking statements. These statements
relate to future events or future financial performance and are subject
to risks and uncertainties. In some cases, you can identify
forward-looking statements by terminology such as “may,” “will,”
“should,” “expect,” “plan,” “anticipate,” “believe,” “feel,” “estimate,”
“predict,” “potential” or “continue,” the negative of such terms or
other comparable terminology. Specifically, comments in this press
release regarding our future prospects, possible future losses, new
opportunities, potential cost saving measures and related benefits,
improved efficiencies and our new O’Neill product offerings are
forward-looking statements and are subject to inherent risks. These
statements are only predictions. Actual events or results may differ
materially. Factors that could cause actual results to differ from those
contained in the forward-looking statements include, but are not limited
to: the general conditions of the domestic and global economy, changes
in consumer discretionary spending; changes in the value of the U.S.
dollar, Canadian dollar and Euro; changes in commodity prices; our
ability to source raw materials and finished products at favorable
prices; risks related to the limited visibility of future orders; our
ability to continue to develop, produce and introduce innovative new
products in a timely manner; our ability to identify and execute
successfully cost-control initiatives without adversely impacting sales;
the performance of new products and continued acceptance of current
products; our execution of strategic initiatives and alliances;
uncertainties associated with intellectual property protection for our
products; and other risks identified from time to time in our filings
made with the U.S. Securities and Exchange Commission. Although, we
believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results. Moreover,
we assume no responsibility for the accuracy or completeness of such
forward-looking statements and undertake no obligation to update any of
these forward-looking statements.
CONSOLIDATED BALANCE SHEETS
|
(Thousands, except number of shares and per share amounts)
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
|
|
2009
|
|
2008
|
|
|
|
(Unaudited)
|
|
|
Assets
|
|
|
|
|
Current assets
|
|
|
|
|
Cash
|
|
$
|
717
|
|
|
$
|
471
|
|
Accounts receivable, net
|
|
|
5,065
|
|
|
|
6,991
|
|
Inventories, net
|
|
|
8,101
|
|
|
|
11,698
|
|
Prepaid expenses and other current assets
|
|
|
1,291
|
|
|
|
1,607
|
|
Income taxes receivable
|
|
|
68
|
|
|
|
171
|
|
Total current assets
|
|
|
15,242
|
|
|
|
20,938
|
|
Property and equipment, net
|
|
|
4,649
|
|
|
|
5,417
|
|
Intangible assets, net of accumulated amortization of $690 and
$601 at September 30, 2009 and December 31, 2008, respectively
|
|
|
325
|
|
|
|
401
|
|
Other long-term assets
|
|
|
99
|
|
|
|
67
|
|
Total assets
|
|
$
|
20,315
|
|
|
$
|
26,823
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
Current liabilities
|
|
|
|
|
Lines of credit
|
|
$
|
2,143
|
|
|
$
|
5,787
|
|
Current portion of capital leases
|
|
|
348
|
|
|
|
483
|
|
Current portion of notes payable
|
|
|
491
|
|
|
|
484
|
|
Accounts payable
|
|
|
5,501
|
|
|
|
8,635
|
|
Accrued expenses and other liabilities
|
|
|
3,532
|
|
|
|
3,868
|
|
Income taxes payable
|
|
|
77
|
|
|
|
214
|
|
Total current liabilities
|
|
|
12,092
|
|
|
|
19,471
|
|
Capitalized leases, less current portion
|
|
|
625
|
|
|
|
754
|
|
Notes payable, less current portion
|
|
|
608
|
|
|
|
357
|
|
Deferred income taxes
|
|
|
426
|
|
|
|
391
|
|
Total liabilities
|
|
|
13,751
|
|
|
|
20,973
|
|
Stockholders' equity
|
|
|
|
|
Preferred stock: par value $0.0001; 5,000,000 authorized; none issued
|
|
|
-
|
|
|
|
-
|
|
Common stock: par value $0.0001; 100,000,000 shares authorized;
11,866,619 and 8,176,850 shares issued and outstanding at
September 30, 2009 and December 31, 2008, respectively
|
|
|
1
|
|
|
|
1
|
|
Additional paid-in-capital
|
|
|
40,348
|
|
|
|
37,432
|
|
Accumulated other comprehensive income
|
|
|
894
|
|
|
|
902
|
|
Accumulated deficit
|
|
|
(34,679
|
)
|
|
|
(32,485
|
)
|
Total stockholders' equity
|
|
|
6,564
|
|
|
|
5,850
|
|
Total liabilities and stockholders' equity
|
|
$
|
20,315
|
|
|
$
|
26,823
|
|
|
|
|
|
|
|
|
|
|
ORANGE 21 INC. AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Thousands, except per share amounts)
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
2009
|
|
2008
|
|
2009
|
|
2008
|
|
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
Net sales
|
|
$
|
8,776
|
|
|
$
|
12,042
|
|
|
$
|
25,313
|
|
|
$
|
37,580
|
|
Cost of sales
|
|
|
5,915
|
|
|
|
6,129
|
|
|
|
14,635
|
|
|
|
19,278
|
|
Gross profit
|
|
|
2,861
|
|
|
|
5,913
|
|
|
|
10,678
|
|
|
|
18,302
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Sales and marketing
|
|
|
1,781
|
|
|
|
3,007
|
|
|
|
5,463
|
|
|
|
9,457
|
|
General and administrative
|
|
|
1,655
|
|
|
|
2,173
|
|
|
|
5,838
|
|
|
|
7,309
|
|
Shipping and warehousing
|
|
|
255
|
|
|
|
400
|
|
|
|
765
|
|
|
|
1,429
|
|
Research and development
|
|
|
292
|
|
|
|
297
|
|
|
|
803
|
|
|
|
930
|
|
Total operating expenses
|
|
|
3,983
|
|
|
|
5,877
|
|
|
|
12,869
|
|
|
|
19,125
|
|
Income (loss) from operations
|
|
|
(1,122
|
)
|
|
|
36
|
|
|
|
(2,191
|
)
|
|
|
(823
|
)
|
Other expense:
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(70
|
)
|
|
|
(161
|
)
|
|
|
(235
|
)
|
|
|
(482
|
)
|
Foreign currency transaction gain (loss)
|
|
|
110
|
|
|
|
191
|
|
|
|
293
|
|
|
|
(17
|
)
|
Other income (expense)
|
|
|
(3
|
)
|
|
|
(7
|
)
|
|
|
(1
|
)
|
|
|
26
|
|
Total other income (expense)
|
|
|
37
|
|
|
|
23
|
|
|
|
57
|
|
|
|
(473
|
)
|
Income (loss) before income taxes
|
|
|
(1,085
|
)
|
|
|
59
|
|
|
|
(2,134
|
)
|
|
|
(1,296
|
)
|
Income tax expense (benefit)
|
|
|
51
|
|
|
|
53
|
|
|
|
60
|
|
|
|
(178
|
)
|
Net income (loss)
|
|
$
|
(1,136
|
)
|
|
$
|
6
|
|
|
$
|
(2,194
|
)
|
|
$
|
(1,118
|
)
|
Net income (loss) per share of Common Stock
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.10
|
)
|
|
$
|
0.00
|
|
|
$
|
(0.19
|
)
|
|
$
|
(0.14
|
)
|
Diluted
|
|
$
|
(0.10
|
)
|
|
$
|
0.00
|
|
|
$
|
(0.19
|
)
|
|
$
|
(0.14
|
)
|
Shares used in computing net income (loss) per share of Common Stock
|
|
|
|
|
|
|
Basic
|
|
|
11,865
|
|
|
|
8,172
|
|
|
|
11,291
|
|
|
|
8,168
|
|
Diluted
|
|
|
11,865
|
|
|
|
8,188
|
|
|
|
11,291
|
|
|
|
8,168
|
|
|
|
|
|
|
|
|
|
|
Source: Orange 21 Inc.
Orange 21 Inc. Jerry Collazo, Chief Financial Officer 760-804-8420 Fax:
760-804-8442 www.orangetwentyone.com
|
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